By Amanda Becker (Reuters) - The United Auto Workers on Thursday announced the formation of a local union in Tennessee for workers at a Chattanooga Volkswagen AG plant, reasserting itself at the site of a major defeat for the union earlier this year. The UAW made its move after years of trying to gain a toehold among foreign automakers in the U.S. South, a region traditionally inhospitable to organized labor. The UAW lost an election in February at the Chattanooga plant, workers voting 712-626 against becoming union members. "Earlier this year, the UAW was gratified to earn the confidence and support of many Volkswagen team members," UAW President Dennis Williams said in a statement. "At that time, we said we would not give up on these committed and hard-working employees. We're keeping our promise," Williams said. The UAW said that membership in UAW Local 42 would be voluntary and give VW Chattanooga workers a chance to participate in the automaker's German-style works council, which typically includes both blue- and white-collar employees. Volkswagen officials in Germany want Chattanooga workers to have a works council, but labor law experts have said that U.S. labor law would require workers to first be represented by a union before a works council could be set up. It was unclear on Thursday whether VW Chattanooga workers could form a works council unless Local 42 signs up a majority of plant workers. UAW leaders were unavailable to answer questions about the local union after a conference call with reporters scheduled for Thursday afternoon was canceled. The UAW has had "ongoing discussions" with VW and the union is "confident the company will recognize" the local union if it signs up a "meaningful portion" of the VW Chattanooga workforce, said a statement from UAW Secretary Treasurer Gary Casteel. A VW spokesman said there is "no contract or other formal agreement" between the automaker and the union at this time. "Just like anywhere else in the world, the establishment of a local organization is a matter for the trade union concerned," VW spokesman Scott Neal Wilson said in statement to Reuters. The UAW's February loss was a major setback for the union. Its former president Bob King, whose term expired in June, had vowed to successfully bring the UAW into a foreign-owned Southern plant, saying that if the union was unable to do so, its future was in jeopardy. The UAW asked the U.S. National Labor Relations Board, the federal agency that oversees union elections and polices labor disputes, to invalidate the results of the February election and hold a new one. The UAW said that VW workers were improperly influenced by anti-union statements made by Tennessee Republican politicians and outside interest groups. The UAW withdrew its legal challenge just hours before a hearing was scheduled to begin in April. Casteel told Reuters at the time that they were worried "objectionists" would delay the process. (Editing by Kevin Drawbaugh and Grant McCool)